Tuesday, October 1, 2019

The 2020-2021 FAFSA (Free Application For Federal Student Aid) Is Now Live

The Free Application for Federal Student Aid – also known as the FAFSA – rolls out today at www.fafsa.ed.gov for students who plan on attending college in Fall 2020. While college application deadlines may be months away, experts stress that students and their families should file their FAFSAs as soon as possible.

The FAFSA is a financial aid form administered by the Department of Education that helps students qualify for loans and financial aid. Household data from the FAFSA –such as annual income and savings – is crunched by the Education Department to determine how much a family could pay toward college. Colleges also receive data from the FAFSA, which serves as the basis for their financial aid offers to applicants, as well as state agencies.

This year, there are 13 states that use the FAFSA that award their grants on a first-come, first-served basis or until the money runs out. So basically, the early bird gets the grant!

Those states are: Texas, Illinois, North Carolina, Alaska, Indiana, Kentucky, Nevada, South Dakota, Oklahoma, Oregon, South Carolina, Vermont and Washington, according to the Department of Education. Some other colleges in other states also award financial aid to those who apply first, which underscores the importance of getting the application completed as soon as possible.
FAFSA deadline: When is it?

The FAFSA federal deadline for students enrolling in the 2020-21 academic year doesn’t close until June 30, 2021. But, as noted earlier, many states and colleges apportion financial aid to those who apply first, which is why I urge you to apply and/or renew as soon as possible. You can find a list of state deadlines here.

Below are three common pitfalls to watch out for with the FAFSA:

1. Skipping the FAFSA 

About one-quarter of families never complete the FAFSA, according to research from student loan company Sallie Mae. The most common reason? Families say they believe they won’t qualify for aid. It's unfortunate because almost every family qualifies for some form of financial aid. It's not all need-based. There are a lot of scholarships and merit-based scholarships a school might grant you, but you have to fill out a FAFSA for a school to qualify for them.

On top of that, federal loans are available only to students who complete a FAFSA, which means you’ll need to submit the form if you are looking to borrow through a Federal Direct Stafford Loan or other types of loans offered by the government. 

2. Waiting to file the FAFSA
Because the FAFSA requires students to list at least one college they plan on applying to in order to complete the application, some families hold off; but that delay could result in lost aid, given the first-come, first-served approach used by some states and colleges.

All you have to have on the FAFSA is one college listed. It should be an in-state public college because some of the states will only consider you for a state grant if an in-state public college is listed on the FAFSA.

Students can add colleges as they hone in on their list of dream schools after the first draft has been submitted.
Other families delay because they weren’t aware of the deadline or didn’t have all the data they need. To apply, both you and your student will need to register for your own Federal Student Aid ID, which can be done here.

It helps to gather the information you’ll need before sitting down to fill out the form. The Department of Education says you’ll need your Social Security number; driver’s license; 2018 tax returns and your bank statements. 

3. Inputting the wrong data

This year could prove trickier for some families completing the FAFSA. Because the IRS simplified the 1040 tax form for 2018, there may be some compatibility issues between the IRS Data Retrieval Tool, which automatically grabs your tax return data for the aid form, and the FAFSA.

That could increase the risk of errors on FAFSAs, which could get those forms flagged for review – called “verification” – from either colleges or the Department of Education. Getting pulled for verification can slow down your FAFSA, allowing others to skip ahead of you in the line.

Double-check your math. Make sure the right lines actually mean the right things, and keep a copy of your tax forms on hand in case your FAFSA application is flagged.

Still, don’t let that hold you back from finishing the FAFSA.

NOTE: I have been contacted by my Freshman students regarding the 2020/2021 FAFSA. This will be applied to your 2nd/Sophomore Year. The 2019/2020 is the FAFSA for which your award is currently based on. Thank you.

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